Caring Winds in the Ocean of Social

As a result of the Industrial Revolution people moved to cities for jobs creating large centralized communities. Then, we started to decentralize by moving out of close knit neighborhoods into a sprawling suburbia. People worked more and generally got busier trying to make money, spend money, pay the bills, etc. as we transitioned to a consumer-based economy. The “porch-to-porch” sharing decreased proportionately. Simply, it became more difficult for communities and even families and friends to share in a decentralized environment. So, sharing was building demand for decades like a beach ball held under water ready to explode to the surface by some catalyst or mechanism. Facebook designed that mechanism. The sharing beach ball exploded to the surface with viral growth and landed on the surface in the Ocean of Social. For we, as a race, have always been and will always be social. Sharing among each other is at the top of our survival instincts. I suppose our brains are hard wired to search for others to share with; to solve problems, to advance solutions, to be empathetic, to survive.

Like fish swimming in the Ocean of Social, we’ve witnessed the powerful rise of beach balls exploding to the surface and we are impressed. We look up and see these beach balls floating above us.  They make it easier to share. While gathering in the shadow of a beach ball we socialize. However, are these floating beach balls being pushed by social winds that lack purpose? Are the beach balls floating aimlessly? Is the wind pushing us, as we stay in the shadow of the beach ball, into shallow waters of engagement?

There are dependencies as to what motivates us to share with others at any given time and there are patterns that seem to govern these dependencies relating to how and why we are social. These patterns lead to designed mechanisms that release stored up demand in the marketplace, again, like a beach ball held under water, ready to explode to the surface.

The mechanisms to release purposed sharing (i.e. collaboration) for people who care about something enough are already being developed for niche communities. Just like Facebook had its predecessors, collaboration platforms are being tested and used in niche communities. They are increasingly sharing to solve problems, niche problems. These beach balls are directed by purposed winds towards deeper waters of interactions (actions, reactions, and transactions).

I believe that we are at the dawn of an era of collaboration like we’ve never seen before. We are at the dawn of caring enough to help each other survive better. The demand is increasing because we are becoming more aware that we are in this together, as one, and what is good for you is good for me. We are learning to sell “win-lose” and buy “win-win” business models! Say good-bye to sharing for sharing’s sake and say hello to sharing for caring’s sake.

Have you noticed any designs that are making it easier to share and contribute to solve niche problems?

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The Enterprise and Placement Improvements

My previous posts titled Evaluating Placement Information (Parts 1 – 3) prompted a request for me to read an article by Don Fornes, CEO of Software Advice which sponsors The New Talent Times blog. I was asked by Software Advice to opine on the article.

The article, titled “The Psychological Profiles of the Dream Team”, was published on BusinessInsider and refers to a commissioned project by Mr. Fornes to analyze the high-performers at his company, to see what drives and motivates them. The research concluded with four distinct personality profiles which describes what makes their top players tick, the management style they respond best to, and how to identify and hire more people like them.

The following is my opinion about the problem the article addresses but in a more expansive view.

First, let’s define the problem. The problem is that an increasing number of people in the world are miserable, hopeless, suffering, and unhappy because they don’t have a good job—one that is a best-fit. The United States is no exception and, in fact, may be the poster child for workplace unhappiness.

Second, in almost all the content relating to ability placement there always seems to be an embedded assumption that we need to rely on the enterprise to make improvements. What if that assumption is wrong? What if the future of work is more about coordinating distributed work activity versus aggregated? Then, as solution providers, I think we need to design for the individual as a work network node, rather than designing for the enterprise as the work center, to realize the improvements we are looking for.

Third, we can look at the financial services industry for an analog to better understand how psychological profiles are used to help place capital at best-fit. After all ability is human capital. My experience tells me that psychological profiling of investors to facilitate the placement of financial capital at best-fit is more art than science. This is because the ongoing decision-making environment is extremely dynamic with very many variables. More specifically, in this space, best-fit knowledge may depend on tacit information held by individuals, distributed in a community network. If you accept this as a constraint and embrace it as such then you’ll be able to see the futility of trying to optimize the art of placing capital at best-fit.

So, in my opinion, psychological profiles can not be relied upon with a high degree of confidence to complete the job-to-be-done successfully. This is not to say that they are not an improvement but rather should be viewed as a sustaining innovation. It is my belief that to make the improvements we are looking for we need disruptive innovation.

Evaluating Placement Information (Part 3 of 3)

Skillfully evaluating information to place ability at best-fit will tend to have three parts: analysis, psychology, and constraints. Accommodating any one of these in a placement process isn’t easy. Being good at all three is rare. Let’s look at the constraints part below and tie up this series of posts.

The Constraints 

The third part of a skillful evaluation addresses constraints. The most important job for principals (i.e. the talent seekers and candidates) here is to manage recruitment risks, or the risks that arise because agent-actors (i.e. placement facilitators) may have interests that differ from those of principals. For example, placement facilitators who are fully paid or credited as of a candidate’s hire date may unwittingly employ conservative strategies associated with top-down recruiting initiatives versus understanding the true growth opportunities represented by the relevant edges of recruiting. More to the point, they might, aggressively market candidates who behave similar to a stereotyped benchmark.

I make this point by distinguishing between the profession and business of agency. The profession is about recruiting talent so as to maximize long-term returns, while the business of recruiting or agency is about earning rewards in the short-term. Naturally, current viability is essential to support the profession. But when a placement facilitator emphasizes the business at the expense of the profession, principals are not best served. Rather, facilitators should concentrate on helping principals find matches that provide sensible balance, relevant diversity, and are under priced. This requires going against the consensus and being willing to appear very different from the pack.

John Maynard Keynes, the renowned economist and investor, wrote about this in The General Theory of Employment, Interest, and Money, published in 1936. He discusses the conduct of a long-term investor: “For it is in the essence of his behavior that he should be eccentric, unconventional and rash in the eyes of the average opinion. If he is successful, that will only confirm the general belief in his rashness; and if in the short run he is unsuccessful, which is very likely, he will not receive much mercy. Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.”

As Keynes suggests, the risk of losing credibility as a placement facilitator for straying too far from convention is important. As a result, facilitators will often strive to be different enough to succeed but not so different as to be considered unconventional. The reason is that they are often inappropriately judged by short-term performance. Likewise, a principal who makes a conventional decision that turns out to be wrong can fall back on the argument that the decision process was usual, even if uninspired, and hence the outcome was based on something unavoidable. A principal who makes a correct but unconventional decision that ends badly is exposed to criticism and the risk of losing credibility.

In hiring, the trend toward conformity is clear. It seems to me that workforces today look more like their stereotyped benchmarks than they did thirty years ago. Just as we see in investment portfolios the measure of how different a mutual fund portfolio is compared to its benchmark, has fallen from 75 percent in 1980 to about 60 percent in 2010 in the United States. Too many leaders in ability placement markets as well as in business fear straying too far from convention, even in cases where the convention isn’t all that great.

Because all three parts to skillfully evaluate placement information are difficult, they stand in the way of great long-term performance. Some can succeed in one or two of those areas, but very few can master all three. This fits with the conclusion of an analysis of skill and luck in hiring: only a handful can surmount the analytical, psychological, and constraint obstacles. The same is true in financial investing which provides an excellent analog to learn from.

Evaluating Placement Information (Part 2 of 3)

Skillfully evaluating information relating to the best-fit placement of ability will tend to have three parts: analysis, psychology, and constraints exerted by principals (i.e. talent seekers and candidates). Accommodating any one of these in a placement process isn’t easy. Being good at all three is rare. Let’s look at the psychology part below.

The Psychology

The second part of a skillful evaluation is psychological. This part deals with talent seeker and candidate biases. These include over confidence, anchoring, confirmation, and relying on what is most recent. These biases arise automatically and are therefore very difficult to overcome by primary placement participants or secondary participants known as influential others. For example, when making a prediction, people tend to give disproportionate weight to whatever they have experienced most recently. In hiring, there is a strong tendency to choose talent seekers or candidates which have done well recently, those that seem to have a hot hand.

Also, how people make decisions when they are uncertain about gains and losses is at odds with classical economic theory. Because good placement process decisions can have bad outcomes, not everyone has a temperament that is well suited to making decisions about activities that involve luck. This emphasizes the importance of being willing to go against the crowd. Most agent-actors (i.e. placement facilitators) know that it is more comfortable to be part of the crowd than to be alone. But it’s also hard to distinguish yourself if you’re doing the same thing as everyone else. Skillful investors, for example, heed Benjamin Graham’s advice: “Have the courage of your knowledge and experience. If you have formed a conclusion from the facts and if you know your judgment is sound, act on it—even though others may hesitate or differ.” However, it is insufficient to be a contrarian because sometimes the consensus is right. The goal is to be a contrarian when it allows you to gain an edge, and the calculator helps you ensure a margin of safety.

We’ll get into the constraints (Part 3 of 3) in the next post.

Do you think there are similarities between evaluating a person’s ability and evaluating a stock?